AEVEX Corp.

Previous wording

The following is a discussion and analysis of our financial condition and results of operations as of, and for, the periods presented. You should read the following discussion and analysis of our financial condition and results of operations together with the sections entitled “Forward-Looking Statements” and “Risk Factors” and the unaudited condensed consolidated financial statements and related notes of AEVEX Corp. and Athena Technology Solutions Holdings, LLC included in this Quarterly Report on Form 10-Q, as well as the sections entitled “Risk Factors,” “Management’s Discussion and Analysis of Financial Condition and Results of Operations” and the audited consolidated financial statements and related notes thereto of AEVEX Corp. and Athena Technology Solutions Holdings, LLC included in our final prospectus, dated April 16, 2026, filed with the SEC pursuant to Rule 424(b) under the Securities Act of 1933 (the “Prospectus”) in connection with our initial public offering (“IPO”).

Current wording

The following is a discussion and analysis of our financial condition and results of operations as of, and for, the periods presented. You should read the following discussion and analysis of our financial condition and results of operations together with the sections entitled “Forward-Looking Statements” and “Risk Factors” and the unaudited condensed consolidated financial statements and related notes of AEVEX Corp. included in this Quarterly Report on Form 10-Q, as well as the sections entitled “Risk Factors,” “Management’s Discussion and Analysis of Financial Condition and Results of Operations” and the audited consolidated financial statements and related notes thereto of AEVEX Corp. and Athena Technology Solutions Holdings, LLC (“Holdings LLC”) included in our final prospectus, dated April 16, 2026, filed with the SEC pursuant to Rule 424(b) under the Securities Act of 1933 (the “IPO Prospectus”) in connection with our initial public offering (“IPO”).

Previous wording

This discussion and analysis contains forward-looking statements, including statements regarding our expectations for the future of our business and our liquidity and capital resources as well as other non-historical statements. These statements are based upon our current plans, expectations, and beliefs, and are subject to numerous risks and uncertainties, including but not limited to the risks and uncertainties described in “Forward-Looking Statements” and in the “Risk Factors” section of our Prospectus. Our actual results may differ materially from those contained in or implied by these forward-looking statements.

Current wording

This discussion and analysis contains forward-looking statements, including statements regarding our expectations for the future of our business and our liquidity and capital resources as well as other non-historical statements. These statements are based upon our current plans, expectations, and beliefs, and are subject to numerous risks and uncertainties, including but not limited to the risks and uncertainties described in “Forward-Looking Statements” and in the “Risk Factors” sections of our most recent filings with the Securities and Exchange Commission. Our actual results may differ materially from those contained in or implied by these forward-looking statements.

Previous wording

•Tactical Systems: Designs and manufactures battle-tested, autonomous, modular, and attritable UxS, including UAS and USV, along with other mission critical products. Tactical Systems segment revenue represented approximately 88.0% and 55.3% of our revenue for the three months ended March 31, 2026 and 2025, respectively.

Current wording

•Tactical Systems: Designs and manufactures battle-tested, autonomous, modular, and attritable UxS, including UAS and USV, along with other mission critical products. Tactical Systems segment revenue represented approximately 86.3% and 71.3% of our revenue for the three months ended June 30, 2026 and 2025, respectively, and approximately 87.2% and 65.8% of our revenue for the six months ended June 30, 2026 and 2025, respectively.

Previous wording

•Global Solutions: Provides bespoke mission solutions, including AI-enabled full-spectrum airborne ISR, C-UAS, additive manufacturing, and specialized mission aircraft engineering, modification, and testing. Global Solutions segment revenue represented approximately 12.0% and 44.7% of our revenue for the three months ended March 31, 2026 and 2025, respectively.

Current wording

•Global Solutions: Provides bespoke mission solutions, including AI-enabled full-spectrum airborne ISR, C-UAS, additive manufacturing, and specialized mission aircraft engineering, modification, and testing. Global Solutions segment revenue represented approximately 13.7% and 28.7% of our revenue for the three months ended June 30, 2026 and 2025, respectively, and approximately 12.8% and 34.2% of our revenue for the six months ended June 30, 2026 and 2025, respectively.

Previous wording

On April 20, 2026, the Company consummated its IPO of 18,400,000 shares of its Class A common stock, which includes the exercise in full by the underwriters of their option to purchase an additional 2,400,000 shares of Class A common stock from us. The 18,400,000 shares were issued at a public offering price of $20.00 per share, resulting in net proceeds to the Company of $345.9 million, after deducting underwriting discounts of $22.1 million. In addition to the underwriting discounts, the Company incurred $13.3 million of offering costs, which will be recorded to additional paid-in capital during the three months ended June 30, 2026.

Current wording

On April 20, 2026, the Company consummated its IPO of 18,400,000 shares of its Class A common stock, which includes the exercise in full by the underwriters of their option to purchase an additional 2,400,000 shares of Class A common stock from us. The 18,400,000 shares were issued at a public offering price of $20.00 per share, resulting in net proceeds to the Company of $345.9 million, after deducting underwriting discounts and commissions of $22.1 million. In addition to the underwriting discounts and commissions, the Company incurred $13.8 million of total offering costs, which were recorded in additional paid-in capital during the three months ended June 30, 2026.

Previous wording

In connection with the IPO, the Company completed the Organizational Transactions described under Note 5, Subsequent Events, of the condensed consolidated financial statements and related notes of AEVEX Corp. and in Note 12. Subsequent Events, of the condensed consolidated financial statements and related notes of Athena Technology Solutions Holdings, LLC, each of which is included in this Quarterly Report on Form 10-Q.

Current wording

In connection with the IPO, the Company completed the Organizational Transactions described under Note 1, Organization, of the Company’s condensed consolidated financial statements and related notes included in this Quarterly Report on Form 10-Q. The following is a summary of the equity transactions consummated in connection with the Organizational Transactions and the IPO:

Previous wording

Our results have been affected, and are expected to be affected in the future, by a variety of factors. A discussion of key factors that have had, or may have, an effect on our results is set forth below. Information regarding the Company’s risk factors appears in the Prospectus under “Risk Factors.”

Current wording

Our results have been affected, and are expected to be affected in the future, by a variety of factors. A discussion of key factors that have had, or may have, an effect on our results is set forth below. Information regarding the Company’s risk factors appears under “Risk Factors” in our most recent filings with the Securities and Exchange Commission.

Previous wording

There is also uncertainty around the timing, extent, nature and effect of Congressional and other U.S. Government actions to address budgetary constraints and caps on the discretionary budget for defense and non-defense departments and agencies. In addition, there is uncertainty around the ability of Congress to determine how to allocate the available budget authority and pass appropriations bills to fund both U.S. Government departments and agencies that are, and those that are not, subject to the caps. Additionally, budget deficits and the growing U.S. national debt may increase pressure on the U.S. Government to reduce federal spending across all federal agencies, with uncertainty about the size and timing of those reductions. Furthermore, delays in the completion of future U.S. Government budgets could delay procurement of the federal government services that we provide.

Current wording

There is also uncertainty around the timing, extent, nature and effect of Congressional and other U.S. Government actions to address budgetary constraints and caps on the discretionary budget for defense and non-defense departments and agencies. In addition, there is uncertainty around the ability of Congress to determine how to allocate the available budget authority and pass appropriations bills to fund both U.S. Government departments and agencies that are, and those that are not, subject to the caps. Additionally, budget deficits and the growing U.S. national debt may increase pressure on the U.S. Government to reduce federal spending across all federal agencies, with uncertainty about the size and timing of those reductions. Furthermore, delays in the completion of future U.S. Government budgets could delay procurement of the federal government services that we provide. During the six months ended June 30, 2026, we experienced elongated award timelines in certain cases resulting from ongoing conflicts in the Middle East, changes to Department of Defense acquisition personnel and processes, and operational reprioritization. These dynamics may result in delays between opportunity identification and contract award, which could affect the timing of our revenue and backlog growth.

Previous wording

We have incurred, and expect to continue to incur, certain non-recurring professional fees and other expenses as part of our transition to becoming a public company. As a public company, we are implementing additional procedures and processes for the purpose of addressing the standards and requirements applicable to public companies. In particular, we expect our accounting, legal and personnel-related expenses and directors’ and officers’ insurance costs to increase as we establish more comprehensive compliance and governance functions, establish, maintain and review internal controls over financial reporting in accordance with the Sarbanes-Oxley Act and prepare and file periodic reports in accordance with SEC rules. Our financial statements following the IPO will reflect the impact of these expenses.

Current wording

We have incurred, and expect to continue to incur, certain non-recurring professional fees and other expenses as part of our transition to becoming a public company. As a public company, we are implementing additional procedures and processes for the purpose of addressing the standards and requirements applicable to public companies. In particular, we expect our accounting, legal and personnel-related expenses and directors’ and officers’ insurance costs to increase as we establish more comprehensive compliance and governance functions, establish, maintain and review internal controls over financial reporting in accordance with the Sarbanes-Oxley Act and prepare and file periodic reports in accordance with SEC rules. Our financial statements following the IPO reflect the impact of these expenses.

Previous wording

Funded backlog includes both single and multi-year awards, and fluctuations in backlog are driven primarily by the timing of large program wins. Thedecrease of$146.5 million in funded backlog for thethree months ended March 31, 2026 was primarily due to revenue recognized for the EUCOM AOR Deep Strike program during thethree months ended March 31, 2026. We expect to convert approximately 93.0% of the total$356.6 million of funded backlog as of March 31, 2026 into revenue during the remainder of 2026.

Current wording

Funded backlog includes both single and multi-year awards, and fluctuations in backlog are driven primarily by the timing of large program wins. Thedecrease of$243.3 million in funded backlog for the six months ended June 30, 2026 was primarily due to revenue recognized for the EUCOM AOR Deep Strike program during the six months ended June 30, 2026. The decrease was also influenced by an increase in shorter-cycle customer orders. We are experiencing a shift in customer ordering patterns toward shorter-cycle procurement, with customers increasingly placing orders for near-term delivery rather than multi-year programs of record. This trend resulted in a greater proportion of our revenue during the six months ended June 30, 2026, being derived from orders received and shipped within the same fiscal year. We expect to convert approximately 95.1% of the total$259.8 million of funded backlog as of June 30, 2026 into revenue during the next 12 months.

Previous wording

In addition, our funded backlog is subject to meaningful customer concentration risk. As of March 31, 2026, approximately 73.9% of the total dollar value of our funded backlog related to the U.S Government. For purposes of evaluating our funded backlog, we consider all U.S. Government entities to be one customer. Additionally, funded backlog that is originally funded through U.S. Government efforts is considered to be U.S. Government backlog even if the program is directly contracted through an intermediary.

Current wording

In addition, our funded backlog is subject to meaningful customer concentration risk. As of June 30, 2026, approximately 92.7% of the total dollar value of our funded backlog related to the U.S Government. For purposes of evaluating our funded backlog, we consider all U.S. Government entities to be one customer. Additionally, funded backlog that is originally funded through U.S. Government efforts is considered to be U.S. Government backlog even if the program is directly contracted through an intermediary.

Previous wording

Selling, General, and Administrative – consists primarily of personnel-related expenses for our sales, marketing, supply chain, finance, legal, human resources and administrative personnel, as well as the costs of customer service, information technology, risk management and related insurance, travel, allocated overhead and other marketing, communications and administrative expenses. We also expect to further invest in our corporate infrastructure and incur additional expenses associated with operating as a public company, including increased legal and accounting costs, investor relations and compliance costs. As a result, we expect that selling, general and administrative expenses will increase in absolute dollars in future periods but decline as a percentage of total revenue over time. In addition, as a result of becoming a public company, we will incur significant additional annual expenses including, among other things, additional directors’ and officers’ liability insurance, costs to administer a public company stock compensation plan, director fees, costs to comply with reporting requirements of the SEC, transfer agent fees, costs for additional accounting, legal and administrative personnel, increased auditing, tax and legal fees, stock exchange listing fees, additional stock-based compensation expense and similar expenses.

Current wording

Selling, General, and Administrative – consists primarily of personnel-related expenses for our sales, marketing, supply chain, finance, legal, human resources and administrative personnel, the costs of customer service, information technology, risk management and related insurance, travel, allocated overhead and other marketing, communications and administrative expenses, as well as acquisition-related costs. We also expect to further invest in our corporate infrastructure and incur additional expenses associated with operating as a public company, including increased legal and accounting costs, investor relations and compliance costs. As a result, we expect that selling, general and administrative expenses will increase in absolute dollars in future periods but decline as a percentage of total revenue over time. In addition, as a result of becoming a public company, we will incur significant additional annual expenses including, among other things, additional directors’ and officers’ liability insurance, costs to administer a public company stock compensation plan, director fees, costs to comply with reporting requirements of the SEC, transfer agent fees, costs for additional accounting, legal and administrative personnel, increased auditing, tax and legal fees, stock exchange listing fees, additional stock compensation expense and similar expenses.

Previous wording

Change in Contingent Consideration – As part of the acquisition of Tribe Aerospace, LLC in 2022, we agreed to pay contingent consideration to the sellers for any EBITDA (as defined in the earnout arrangement) recognized over certain thresholds during the earnout period from 2022-2024. The contingent consideration was settled using a combination of cash and Class A units based on converting a portion of each contingent payment to units at the fixed contractual price per unit. The change in fair value of the liability during the three months ended March 31, 2025 represents accretion of the discounted liability outstanding during the period. All earnout arrangement liabilities were settled as of December 31, 2025.

Current wording

Change in Contingent Consideration – As part of the acquisition of Tribe Aerospace, LLC in 2022, we agreed to pay contingent consideration to the sellers for any EBITDA (as defined in the earnout arrangement) recognized over certain thresholds during the earnout period from 2022-2024. The contingent consideration was settled using a combination of cash and Class A units based on converting a portion of each contingent payment to units at the fixed contractual price per unit. The change in fair value of the liability during the six months ended June 30, 2025 represents accretion of the discounted liability outstanding during the period. All earnout arrangement liabilities were settled as of December 31, 2025.

Previous wording

Interest Expense – consists primarily of interest expense incurred on borrowings under our Credit Agreement.

Current wording

Interest Expense – consists primarily of interest expense incurred on borrowings under our credit agreements.

Previous wording

Change in Derivative Liability– During December 2025 and the three months ended March 31, 2026, the Company issued Series A preferred units with conversion features that represent an embedded derivative that is accounted for separately from the Series A preferred units and remeasured at fair value at each reporting date, with the changes in fair value recorded through earnings.

Current wording

Change in Derivative Liability– During December 2025 and the three months ended March 31, 2026, the Company issued Series A preferred units with conversion features that represent an embedded derivative that is accounted for separately from the Series A preferred units and remeasured at fair value at each reporting date, with the changes in fair value recorded through earnings. In connection with the IPO, the 115,342 of Holdings LLC’s Series A preferred units (and the related derivative liability) outstanding prior to the Organizational Transactions were, in accordance with their terms, converted into 7,208,876 shares of the Company’s Class A common stock at a conversion price based on 80% of the IPO price.

Previous wording

Cost of products revenue increased to $140.2 million from $24.2 million, or by $115.9 million and 478.2%, for the three months ended March 31, 2026 compared to the three months ended March 31, 2025. The higher cost of products revenue is primarily due to $114.7 million of higher costs in our Tactical Systems segment from our EUCOM AOR Deep Strike program during the three months ended March 31, 2026 compared to three months ended March 31, 2025. The $114.7 million of higher costs is comprised of an approximately $109.3 million increase in materials related costs and an approximately $5.4 million increase in direct and indirect labor costs.

Current wording

Cost of products revenue increased to $130.3 million from $58.6 million, or by $71.7 million and 122.3%, for the three months ended June 30, 2026 compared to the three months ended June 30, 2025. The increase is primarily due to higher cost of revenue in our Tactical Systems segment. $57.6 million of the increase is from our EUCOM AOR Deep Strike program with the remainder of the increase being primarily from other UAS products. The $57.6 million of higher costs from our EUCOM AOR Deep Strike program is comprised of an approximately $50.6 million increase in materials related costs and an approximately $7.0 million increase in direct and indirect labor costs.

Previous wording

Gross profit increased to $56.5 million from $3.1 million, or by $53.4 million and 1745.0%, for the three months ended March 31, 2026 compared to the three months ended March 31, 2025. The gross profit percentage increased from 5.7% for the three months ended March 31, 2025 to 26.1% for the three months ended March 31, 2026. The increase was primarily due to $161.0 million of higher revenue in our Tactical Systems segment primarily from UAS products and $4.4 million of higher revenue in our Global Solutions segment primarily from aircraft modifications and testing products, which is offset by $114.7 million of higher costs in our Tactical Systems segment from our EUCOM AOR Deep Strike program.

Current wording

Gross profit increased to $47.6 million from $18.4 million, or by $29.2 million and 159.3%, for the three months ended June 30, 2026 compared to the three months ended June 30, 2025. The gross profit percentage increased from 18.2% for the three months ended June 30, 2025 to 23.6% for the three months ended June 30, 2026. The increase was primarily due to $99.6 million of higher revenue and $73.6 million of higher costs in our Tactical Systems segment primarily from UAS products.

Previous wording

Research and development expenses decreased to $3.3 million from $9.5 million, or by $6.2 million and 64.8%, for the three months ended March 31, 2026 compared to the three months ended March 31, 2025. The decrease was primarily due to the $5.6 million decrease in development activities for UAS products and services.

Current wording

Research and development expenses decreased to $5.6 million from $7.2 million, or by $1.6 million and 21.6%, for the three months ended June 30, 2026 compared to the three months ended June 30, 2025. The decrease was primarily due to the $1.6 million decrease in development activities for UAS products and services.

Previous wording

Amortization of intangible assets increased to $4.1 million from $4.1 million, or by $42 thousand and 1.0%, for the three months ended March 31, 2026 compared to the three months ended March 31, 2025.

Current wording

Amortization of intangible assets increased to $4.2 million from $4.1 million, or by $0.1 million and 1.0%, for the three months ended June 30, 2026 compared to the three months ended June 30, 2025.

Previous wording

As part of the acquisition of Tribe Aerospace, LLC in 2022, the Company agreed to pay contingent consideration to the sellers for any EBITDA (as defined in the earnout arrangement) recognized over certain thresholds during the earnout period from 2022 to 2024. The contingent consideration was settled using a combination of cash and Class A units of the Company based on converting a portion of each contingent payment to units at the fixed contractual price per unit. The change in fair value of the liability during the three months ended March 31, 2025 represents accretion of the discounted liability outstanding during the period. All earnout arrangement liabilities were settled as of December 31, 2025.

Current wording

As part of the acquisition of Tribe Aerospace, LLC in 2022, the Company agreed to pay contingent consideration to the sellers for any EBITDA (as defined in the earnout arrangement) recognized over certain thresholds during the earnout period from 2022 to 2024. The contingent consideration was settled using a combination of cash and Class A units of Holdings LLC based on converting a portion of each contingent payment to units at the fixed contractual price per unit. The change in fair value of the liability during the three months ended June 30, 2025 represents accretion of the discounted liability outstanding during the period. All earnout arrangement liabilities were settled as of December 31, 2025.

Previous wording

Services revenue decreased to $24.8 million from $26.8 million, or by $1.9 million and 7.2%, for the three months ended March 31, 2026 compared to the three months ended March 31, 2025. The decrease is primarily due to $2.2 million of lower revenue in our Global Solutions segment primarily from mission support, intelligence, surveillance, and reconnaissance services.

Current wording

Services revenue increased to $58.0 million from $57.1 million, or by $0.9 million and 1.6%, for the six months ended June 30, 2026 compared to the six months ended June 30, 2025. The increase is primarily due to $2.9 million of higher revenue in our Tactical Systems segment primarily from UAS support services, which is partially offset by $2.0 million of lower revenue in our Global Solutions segment primarily from mission support, intelligence, surveillance, and reconnaissance services.

Previous wording

Cost of services revenue decreased to $20.0 million from $26.0 million, or by $6.0 million and 22.8%, for the three months ended March 31, 2026 compared to the three months ended March 31, 2025. The lower costs of service revenue is primarily due to a $4.0 million decrease in labor and material costs in the Global Solutions segment.

Current wording

Cost of services revenue decreased to $43.9 million from $50.1 million, or by $6.2 million and 12.4%, for the six months ended June 30, 2026 compared to the six months ended June 30, 2025. The lower costs of service revenue is primarily due to a $3.4 million decrease in labor and material costs of an expiring contract in the Global Solutions segment and a $2.2 million decrease in labor and material costs of an expiring contract in the Tactical Solutions segment.

Previous wording

Selling, general, and administrative expenses increased to $19.4 million from $8.6 million, or by $10.8 million and 126.0%, for the three months ended March 31, 2026 compared to the three months ended March 31, 2025. The increase was primarily due to a $3.8 million increase in audit and accounting fees related to our IPO process, a $3.0 million increase in new employee-related costs, and a $1.1 million repurchase of Incentive Units during the three months ended March 31, 2026.

Current wording

Selling, general, and administrative expenses increased to $41.9 million from $18.0 million, or by $23.9 million and 133.0%, for the six months ended June 30, 2026 compared to the six months ended June 30, 2025. The increase was primarily due to a $11.6 million increase in professional fees related to our IPO process, secondary offering and business acquisition, a $5.0 million increase in incentive compensation expense, a $3.9 million increase in new employee-related costs, a $1.6 million increase in noncash stock compensation expense, and a $1.1 million repurchase of Incentive Units during the six months ended June 30, 2026.

Previous wording

Other income, net increased to $0.2 million from $0, or by $0.2 million, for the three months ended March 31, 2026 compared to the three months ended March 31, 2025.

Current wording

Other income, net increased to $0.2 million from $0, or by $0.2 million, for the six months ended June 30, 2026 compared to the six months ended June 30, 2025.

Previous wording

Tactical Systems Adjusted EBITDA increased to$38.5 million from$(9.9) million, or by$48.4 million, forthree months ended March 31, 2026, compared tothree months ended March 31, 2025. Theincrease is primarily due to the increase in products revenue and the decrease in research and development expense for UAS products and services discussed above, which is offset by the increase in cost of products revenue and the increase in selling, general and administrative expenses for new employee-related costs discussed above.

Current wording

Tactical Systems Adjusted EBITDA increased to$68.1 million from$(6.9) million, or by$75.0 million, for thesix months ended June 30, 2026 compared to the six months ended June 30, 2025. Theincrease is primarily due to the increase in products revenue and the decrease in research and development expense for UAS products and services discussed above, which is offset by the increase in cost of products revenue and the increase in selling, general and administrative expenses for incentive compensation expense and new employee-related costs discussed above.

Previous wording

Global Solutions segment revenue increased to$25.9 million from$23.8 million, or by$2.1 million and 8.8%, forthree months ended March 31, 2026, compared tothree months ended March 31, 2025. Theincrease is primarily due to$4.3 millionof higher revenue from aircraft modifications and testing products and services, which is offset by $2.2 million of lower revenue from mission support, intelligence, surveillance, and reconnaissance products and services.

Current wording

Global Solutions segment revenue increased to$53.5 million from$52.8 million, or by$0.7 million and 1.2%, for thesix months ended June 30, 2026 compared to the six months ended June 30, 2025. Theincrease is primarily due to$2.6 million of higher revenue from aircraft modifications and testing products and services, which is offset by $2.0 million of lower revenue from mission support, intelligence, surveillance, and reconnaissance products and services.

Previous wording

Global Solutions Adjusted EBITDA increased to$4.2 million from$(2.1) million, or by$6.3 million, forthree months ended March 31, 2026, compared tothree months ended March 31, 2025. Theincrease is primarily due to higher gross profit from aircraft modification and testing products and services andmission support, intelligence, surveillance, and reconnaissance services.

Current wording

Global Solutions Adjusted EBITDA increased to$8.1 million from$0.1 million, or by$8.0 million, for thesix months ended June 30, 2026 compared to the six months ended June 30, 2025. Theincrease is primarily due to higher gross profit from aircraft modification and testing products and services andmission support, intelligence, surveillance, and reconnaissance services and lower research and development expenses.

Previous wording

The non-GAAP financial measures presented in this Quarterly Report on Form 10-Q are supplemental measures of our performance that we believe help investors understand our financial condition and operating results and assess our future prospects. We believe that presenting these non-GAAP financial measures, in addition to the corresponding GAAP financial measures, are important supplemental measures that exclude non-cash or other items that may not be indicative of or are unrelated to our core operating results and the overall health of our company. We believe that these non-GAAP financial measures provide investors with greater transparency to the information used by management for its operational decision-making. We further believe that providing this information assists our investors in understanding our operating performance and the methodology used by management to evaluate and measure such performance. When read in conjunction with our GAAP results, these non-GAAP financial measures provide a baseline for analyzing trends in our underlying businesses and can be used by management as a basis for financial, operational and planning decisions. Finally, these measures are often used by analysts and other interested parties to evaluate companies in our industry.

Current wording

The non-GAAP financial measures presented in this Quarterly Report on Form 10-Q are supplemental measures of our performance that we believe help investors understand our financial condition and operating results and assess our future prospects. We believe that presenting these non-GAAP financial measures, in addition to the corresponding GAAP financial measures, are important supplemental measures that exclude non-cash or other items that may not be indicative of or are unrelated to our core operating results and the overall health of our company. We believe that these non-GAAP financial measures provide investors with greater transparency to the information used by management for its operational decision-making. We further believe that providing this information assists our investors in understanding our operating performance and the methodology used by management to evaluate and measure such performance. When read in conjunction with our

Previous wording

We define Adjusted EBITDA as net income (loss) before interest income and expense, income tax expense (benefit), depreciation and amortization expense, other income (expense), changes in the fair value of contingent consideration and derivative liabilities, IPO-related costs, asset impairments, business acquisition costs, and restructuring costs, as well as certain non-recurring items. We define Adjusted EBITDA Margin as Adjusted EBITDA divided by revenue. We believe that Adjusted EBITDA and Adjusted EBITDA Margin are important metrics for management and investors as they remove the impact of items that we do not believe are indicative of our core operating results or the overall health of our company and allow for consistent comparison of our operating results over time and relative to ourpeers.

Current wording

We define Adjusted EBITDA as net income (loss) before interest income and expense, income tax expense (benefit), depreciation and amortization expense, other income (expense), changes in the fair value of contingent consideration liabilities and derivative liabilities, noncash stock compensation expense, offering costs related to the IPO or Secondary Offering, asset impairments, business acquisition costs, restructuring costs, andgains or losses on debt extinguishments, as well as certain non-recurring items. We define Adjusted EBITDA Margin as Adjusted EBITDA divided by revenue. We believe that Adjusted EBITDA and Adjusted EBITDA Margin are important metrics for management and investors as they remove the impact of items that we do not believe are indicative of our core operating results or the overall health of our company and allow for consistent comparison of our operating results over time and relative to ourpeers.

Previous wording

The following table presents a reconciliation of net income to Adjusted EBITDA and Adjusted EBITDA Margin for the three months ended March 31, 2026 and 2025 (in thousands):

Current wording

The following table presents a reconciliation of net income to Adjusted EBITDA and Adjusted EBITDA Margin for the three and six months ended June 30, 2026 and 2025 (in thousands):

Previous wording

On April 20, 2026, we completed our IPO of 18,400,000 shares of our Class A common stock at a price of $20.00 per share, resulting in net cash proceeds of $345.9 million, after deducting underwriting discounts and commissions. In addition, on April 20, 2026, subsidiaries of Holdings LLC refinanced the Prior Credit Facilities and entered into the New Credit Facilities. Holdings LLC used the $100.0 million proceeds from the New Term Loan Facility and the proceeds it received from AEVEX Corp. for the purchase of newly issued Series A units (i) to repay approximately $258.5 million of outstanding borrowings under our Prior Credit Facilities, (ii) to pay $3.3 million of expenses incurred in connection with the refinancing, (iii) to pay $10.3 million of expenses incurred with the IPO and Organizational Transactions and (iv) for general corporate purposes.

Current wording

On April 20, 2026, we completed our IPO of 18,400,000 shares of our Class A common stock at a price of $20.00 per share, resulting in net cash proceeds of $345.9 million, after deducting underwriting discounts and commissions. In addition, on April 20, 2026, subsidiaries of Holdings LLC refinanced the Prior Credit Facilities and entered into the New Credit Facilities. Holdings LLC used the $100.0 million proceeds from the New Term Loan Facility and the proceeds it received from AEVEX Corp. for the purchase of newly issued Series A units (i) to repay approximately $258.5 million of outstanding borrowings under our Prior Credit Facilities, (ii) to pay $3.3 million of expenses incurred in connection with the refinancing, (iii) to pay $8.3 million of expenses incurred with the IPO and Organizational Transactions and (iv) for general corporate purposes.

Previous wording

After the consummation of the IPO, AEVEX Corp. is a holding company and has no material assets other than its ownership of equity interests in Holdings LLC. AEVEX Corp. will have no independent means of generating revenue or cash flow. Under the terms of the LLC Operating Agreement and the Tax Receivable Agreement, Holdings LLC is obligated to make tax distributions to the LLC Unitholders, including us. To the extent that Holdings LLC has available cash, we intend to cause Holdings LLC to make cash distributions to the LLC Unitholders, including us, in amounts sufficient to (1) fund all or part of their tax obligations in respect of taxable income allocated to them and (2) cover our operating expenses, including payments under the Tax Receivable Agreement.

Current wording

After the consummation of the IPO, AEVEX Corp. is a holding company and has no material assets other than its ownership of equity interests in Holdings LLC. AEVEX Corp. will have no independent means of generating revenue or cash flow. Under the terms of the LLC Operating Agreement and the Tax Receivable Agreement (“TRA”), Holdings LLC is obligated to make tax distributions to the LLC Unitholders, including us. To the extent that Holdings LLC has available cash, we intend to cause Holdings LLC to make cash distributions to the LLC Unitholders, including us, in amounts sufficient to (1) fund all or part of their tax obligations in respect of taxable income allocated to them and (2) cover our operating expenses, including payments under the Tax Receivable Agreement.

Previous wording

The actual amount and timing of any payments under the Tax Receivable Agreement will vary depending upon a number of factors, including the timing of exchanges by ATS Investment Holdings (or certain permitted transferees thereof), the amount of gain recognized by ATS Investment Holdings (or certain permitted transferees thereof), the amount and timing of the taxable income we generate in the future and the federal tax rates then applicable. However, we expect that the payments AEVEX Corp. will be required to make under the Tax Receivable Agreement will be substantial and could materially affect our liquidity. Assuming there are no material changes in the relevant tax laws and that we earn sufficient taxable income to realize all tax benefits that are subject to the Tax Receivable Agreement, and assuming all exchanges or redemptions would occur immediately after the IPO, we would have been required to pay approximately $373.2 million over the fifteen year period from the date of the IPO. There can be no assurance that Holdings LLC and its subsidiaries will generate sufficient cash flow to distribute funds to us or that applicable state law and contractual restrictions, including negative covenants in debt instruments of Holdings LLC and its subsidiaries, will permit such distributions.

Current wording

The actual amount and timing of any payments under the TRA will vary depending upon a number of factors, including the timing of exchanges by ATS Investment Holdings (or certain permitted transferees thereof), the amount of gain recognized by ATS Investment Holdings (or certain permitted transferees thereof), the amount and timing of the taxable income we generate in the future and the federal tax rates then applicable. However, we expect that the payments AEVEX Corp. will be required to make under the TRA will be substantial and could materially affect our liquidity.

Previous wording

Any payments made by us under the Tax Receivable Agreement will generally reduce the amount of overall cash flow that might have otherwise been available to use and, to the extent that we are unable to make payments under the Tax Receivable Agreement for any reason, the unpaid amounts generally will be deferred and will accrue interest until paid by us. If AEVEX Corp. does not have sufficient funds to pay taxes, payments under the Tax Receivable Agreement or other liabilities or to fund its operations, it may have to borrow funds, which could materially adversely affect its liquidity and financial condition and subject it to various restrictions imposed by any such lenders.

Current wording

There can be no assurance that Holdings LLC and its subsidiaries will generate sufficient cash flow to distribute funds to us or that applicable state law and contractual restrictions, including negative covenants in debt instruments of Holdings LLC and its subsidiaries, will permit such distributions. Any payments made by us under the TRA will generally reduce the amount of overall cash flow that might have otherwise been available to use and, to the extent that we are unable to make payments under the TRA for any reason, the unpaid amounts generally will be deferred and will accrue interest until paid by us. If AEVEX Corp. does not have sufficient funds to pay taxes, payments under the TRA or other liabilities or to fund its operations, it may have to borrow funds, which could materially adversely affect its liquidity and financial condition and subject it to various restrictions imposed by any such lenders.

Previous wording

In addition to payments required by the Tax Receivable Agreement, our expected primary uses of cash on a short and long-term basis are for working capital requirements, capital expenditures, R&D, debt service requirements, potential acquisitions, and other general corporate purposes. Our primary working capital requirements are for project execution activities including purchases of materials, subcontracted services and payroll, which fluctuate during the year, driven primarily by the timing and extent of activities required on new and existing projects.

Current wording

In addition to payments required by the TRA, our expected primary uses of cash on a short and long-term basis are for potential acquisitions, including the proposed acquisition of BlackSea Technologies, working capital requirements, capital expenditures, R&D, debt service requirements, and other general corporate purposes. Our primary working capital requirements are for project execution activities including purchases of materials, subcontracted services and payroll, which fluctuate during the year, driven primarily by the timing and extent of activities required on new and existing projects.

Previous wording

We believe that our cash and cash equivalents, cash provided by our operations, and amounts available under our New Credit Agreement will be adequate to meet our liquidity requirements for at least the next 12 months. Our future long-term capital requirements will depend on several factors, including our ability to raise additional capital and, over time, our ability to generate positive cash flows from operations. Accordingly, we may try to raise additional capital, whether in the public or private markets. To the extent existing cash and cash equivalents are not sufficient to fund future activities, we may borrow under our New Credit Agreement or seek to raise additional funds through equity, equity-linked or debt financings. We may enter into agreements or letters of intent with respect to potential investments in, or acquisitions of, complementary businesses, services or technologies, which could also require us to seek additional equity financing, incur indebtedness or use cash resources.

Current wording

Our future long-term capital requirements will depend on several factors, including our ability to raise additional capital and, over time, our ability to generate positive cash flows from operations. Accordingly, we may try to raise additional capital, whether in the public or private markets. We intend to use cash and cash equivalents and borrowings under our New Credit Agreement to fund our future activities. To the extent those funds are not sufficient, we may seek to raise additional funds through equity, equity-linked or debt financings. We may enter into agreements or letters of intent with respect to potential investments in, or acquisitions of, complementary businesses, services or technologies, which could also require us to seek additional equity financing, incur indebtedness or use cash resources.

Previous wording

On April 20, 2026, we entered into the New Credit Agreement that provides for facilities in an aggregate principal amount of $375.0 million, consisting of (i) a senior secured Term Loan Facility with an aggregate principal amount of $100.0 million, (ii) a senior secured Delayed Draw Term Loan Facility with an aggregate principal amount of $75.0 million and (iii) a senior secured Revolving Credit Facility with an aggregate principal amount of $200.0 million, which includes a sublimit for the issuance of letters of credit in an amount up to $40.0 million and a sublimit for swing line loans in an amount up to $30.0 million. As of the closing of the Company’s IPO, the aggregate principal amount borrowed under the New Credit Facilities is $100.0 million from the Term Loan Facility. Borrowings under the New Revolving Credit Facility and the New Delayed Draw Term Loan Facility may vary significantly from time to time depending on our cash needs at any given time. The New Revolving Credit Facility was undrawn at the closing of the IPO, and the Delayed Draw Term Loan Facility was not borrowed at the closing of the IPO.

Current wording

On April 20, 2026, we entered into the New Credit Agreement that provides for facilities in an aggregate principal amount of $375.0 million, consisting of (i) a senior secured Term Loan Facility with an aggregate principal amount of $100.0 million, (ii) a senior secured Delayed Draw Term Loan Facility with an aggregate principal amount of $75.0 million and (iii) a senior secured Revolving Credit Facility with an aggregate principal amount of $200.0 million, which includes a sublimit for the issuance of letters of credit in an amount up to $40.0 million and a sublimit for swing line loans in an amount up to $30.0 million. As of the closing of the Company’s IPO, the aggregate principal amount borrowed under the New Credit Facilities is $100.0 million from the Term Loan Facility. Borrowings under the New Revolving Credit Facility and the New Delayed Draw Term Loan Facility may vary significantly from time to time depending on our cash needs at any given time. The New Revolving Credit Facility was undrawn at the closing of the IPO and as of June 30, 2026, and the Delayed Draw Term Loan Facility was not borrowed at the closing of the IPO and as of June 30, 2026.

Previous wording

The New Credit Facilities will mature on April 20, 2031. Borrowings under the New Credit Agreement are available, at the Borrower’s option, as term SOFR loans or base rate loans. Term SOFR loans under the New Credit Agreement accrue interest at a SOFR rate plus an applicable rate of 2.25% to 3.00% (depending on the secured net leverage ratio of the Borrower and its restricted subsidiaries). Base rate loans under the New Credit Agreement accrue interest at a base rate plus an applicable rate of 1.25% to 2.00% (depending on the secured net leverage ratio of the Borrower and its restricted subsidiaries). The Revolving Credit Facility also has a variable commitment fee, which is tied to the secured net leverage ratio of the Borrower and its restricted subsidiaries, which ranges from 0.25% to 0.50% per annum. Unused commitments made under the Delayed Draw Term Loan Facility have a commitment fee that accrues (i) from April 20, 2026, until October 17, 2026, at a rate of 0.00% per annum and (ii) thereafter, at a rate of 0.50% per annum. The commitment period under the Delayed Draw Term Loan Facility ends on the earlier of (i) April 20, 2028 and (ii) the commitments under the Delayed Draw Term Loan Facility being fully drawn or otherwise terminated under the New Credit Agreement.

Current wording

The New Credit Facilities mature on April 20, 2031. Borrowings under the New Credit Agreement are available, at the Borrower’s option, as term SOFR loans or base rate loans. Term SOFR loans under the New Credit Agreement accrue interest at a SOFR rate plus an applicable rate of 2.25% to 3.00% (depending on the secured net leverage ratio of the Borrower and its restricted subsidiaries). Base rate loans under the New Credit Agreement accrue interest at a base rate plus an applicable rate of 1.25% to 2.00% (depending on the secured net leverage ratio of the Borrower and its restricted subsidiaries). The Revolving Credit Facility also has a variable commitment fee, which is tied to the secured net leverage ratio of the Borrower and its restricted subsidiaries, which ranges from 0.25% to 0.50% per annum. Unused commitments made under the Delayed Draw Term Loan Facility have a commitment fee that accrues (i) from April 20, 2026, until October 17, 2026, at a rate of 0.00% per annum and (ii) thereafter, at a rate of 0.50% per annum. The commitment period under the Delayed Draw Term Loan Facility ends on the earlier of (i) April 20, 2028 and (ii) the commitments under the Delayed Draw Term Loan Facility being fully drawn or otherwise terminated under the New Credit Agreement.

Previous wording

The Revolving Credit Facility will not amortize. The Term Loan Facility and the Delayed Draw Term Loan Facility (to the extent funded) will amortize in equal quarterly installments, commencing with the last day of September 30, 2026, in aggregate annual amounts according to the following amortization schedule:

Current wording

The Revolving Credit Facility does not amortize. The Term Loan Facility and the Delayed Draw Term Loan Facility (to the extent funded) will amortize in equal quarterly installments, commencing with the last day of September 30, 2026, in aggregate annual amounts according to the following amortization schedule:

Previous wording

The Credit Agreement provided for a senior secured term loan facility (the “Term Loan”) in an original aggregate principal amount of $325.0 million. The Credit Agreement also provided for a super priority senior secured revolving credit facility in an aggregate principal amount of $25.0 million (the “Revolving Credit Facility” and, together with the Term Loan, the “Credit Facilities”). The Revolving Credit Facility includes a $5.0 million sublimit for the issuance of letters of credit. As of March 31, 2026, we had $258.5 million outstanding under the Term Loan and no borrowing outstanding under the Revolving Credit Facility. The Term Loan matured on March 18, 2028. Borrowings, if any, under the Revolving Credit Facility matured on March 18, 2028.

Current wording

The Credit Agreement provided for a senior secured term loan facility (the “Term Loan”) in an original aggregate principal amount of $325.0 million. The Credit Agreement also provided for a super priority senior secured revolving credit facility in an aggregate principal amount of $25.0 million (the “Revolving Credit Facility” and, together with the Term Loan, the “Credit Facilities”). The Revolving Credit Facility included a $5.0 million sublimit for the issuance of letters of credit. The borrowings were guaranteed and secured by substantially all our assets and our subsidiaries.